Cost Plan (Notes) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Restructuring and Related Activities Disclosure |
Note 9. Cost Plan
In the second quarter of fiscal 2018, the Company announced a Cost Plan designed to align the Company’s cost structure to its long-term margin targets. As part of this plan, the Company has initiated a series of targeted actions across the Company’s businesses to reduce annual costs by $1 billion, excluding incremental costs resulting from any future acquisition of a business. The Company expects these cost reductions to be fully captured in fiscal 2019.
During the nine months ended June 24, 2018, the Company recorded restructuring and restructuring-related charges of $422 million in other expenses (Note 2), which consisted of restructuring charges of $302 million, primarily related to severance costs, and restructuring-related charges of $120 million, primarily related to certain asset impairments. In connection with this plan, the Company expects to incur additional restructuring and restructuring-related charges of approximately $50 million to $150 million, which primarily consist of severance and consulting costs, and the vast majority of which are expected to be settled in cash.
The restructuring accrual, a portion of which was included in payroll and other benefits related liabilities with the remainder included in other current liabilities, is expected to be substantially paid within the next 12 months. Changes in the restructuring accrual for fiscal 2018 were as follows (in millions):
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